Question 1
1. ExxonMobile 15 years bond pays a semiannual coupon payment of $35, if the current yield to maturity of the bond is 10% annually then what would be market price of the bond? Explain what will happen to bond price if the current yield to maturity of the bond increases by 100 basis points? Explain what will happen to bond value if the bond matures in 10 years instead of 15 years? 2. Answer following questions based on the information provided in the table below: Stocks Investment Beta A 40,000 1.2 B 60,000 0.75 C 20,000 -0.5 D 100,000 1.0 a.If the market risk premium is 8% and the risk free rate is 8%, estimate the required rate of return for each of the stocks. (3.0 points) b. What is the portfolio beta? (1.0 point) c. What is the required rate of return on the portfolio? 3.GE has a bond outstanding with 10 years to mature and callable in 6 years. The coupon rate of this bond is 9% paid semi-annually. The call price of the bond is 109% of the face value and the current market price of the bond is $950. Find the yield to maturity (YTM) and yield to call (YTC) of this bond. Do you think GE should call this bond? (2.0+2.0+1.0 = 5 points) 4.You intend to purchase IBM Stock at $ 60 per share, hold it 1 year, and then sell it after a dividend of $3 is paid. IBM has a beta of 0.9, the required rate of return on market portfolio is 10% and the risk free rate is 6%.How much will the stock price have to appreciate next year? (5 points),Can you show me how to get the answers step by step and which formulas to use?
Question 2
2. Nixon Communications is trying to estimate the first-year operating cash flow (at t = 1) for a proposed project. The financial staff has collected the following information: Project sales $10 million Operating costs (not including depreciation) $7 million Depreciation $2 million Interest expense $2 million The company faces a 40% tax rate. What is the project's operating cash flow for the first year (t = 1)? 3. Carter Air Lines is now in the terminal year of a project. The equipment originally cost $20 million, of which 80% has been depreciated. Carter can sell the used equipment today to another airline for $5 million, and its tax rate is 40%. What is the equipment?s after-tax net salvage value? 4. The Campbell Company is evaluating the proposed acquisition of a new milling machine. The machine?s base price is $108,000, and it would cost another $12,500 to modify it for special use. The machine falls into the MACRS 3-year class, and it would be sold after 3 years for $65,000. The machine would require an increase in net working capital (inventory) of $5,500. The milling machine would have no effect on revenues, but it is expected to save the firm $44,000 per year in before tax operating costs, mainly labor. Campbell?s marginal tax rate is 35%. a. What is the net cost of the machine for capital budgeting purposes? (That is, what is the Year 0 net cash flow?) b. What are the net operating cash flows in Years 1, 2, and 3? c. What is the additional Year 3 cash flow (that is, the after-tax salvage and the return of working capital)? d. If the project?s cost of capital is 12%, should the machine be purchased? 5. You have been asked by the president of your company to evaluate the proposed acquisition of a new spectrometer for the firm?s R&D department. The equipment?s basic price is $70,000, and it would cost another $15,000 to modify it for special use by your firm. The spectrometer, which falls into the MACRS 3-year class, would be sold after 3 years for $30,000. Use of the equipment would require an increase in net working capital (spare parts inventory) of $4,000. The spectrometer would have no effect on revenues, but it is expected to save the firm $25,000 per year in before-tax operating costs, mainly labor. The firm?s marginal federal-plus-state tax rate is 40%. a. What is the net cost of the spectrometer? (That is, what is the Year 0 net cash flow?) b. What are the net operating cash flows in Years 1, 2, and 3? c. What is the additional (nonoperating) cash flow in Year 3? d. If the project?s cost of capital is 10%, should the spectrometer be purchased?,Will you be able to have the assignment done by tommorrow. Here are the answers???? These are the answers. (12-1) $12,000,000. (12-2) $2,600,000. (12-3) $4,600,000. (12-4) a. _$126,000. b. $42,518; $47,579; $34,926. c. $50,702. d. NPV _ $10,841; Purchase. (12-5) a. ($89,000). b. $26,220; $30,300; $20,100. c. $24,380. d. NPV __$6,704; Don?t,did you ger my message
Question 3
Congratulations! You are now the new accountant of the X Company. X acquired 90% of Y's stock on January 1, 2011. X manufactures devices used at firework displays and Y conducts these displays. X decided to make this acquisition because Y was seen as a natural extension of X's business. Unfortunately, some of the accounting records were recently destroyed in a flood (not a fire). Hap Hazard, the former accountant, was fired because he lacked the necessary accounting skills demanded by this position. You were able to ascertain that Hap used the cost method to account for this investment and the related transaction that occurred during 2011 appeared to be properly recorded. However, upon further review the entry to record the initial investment looks suspicious and may need to be adjusted. From your review, you determine the following: 1. X issued to the public 100,000 shares of $1 par stock. X received $1,000,000 in this transaction. 2. The entire proceeds were then used to purchase a 90% interest in Y. 3. Hap recorded the above transactions with a debit entry to the Investment in Y for $720,000 and credits to Common Stock for $100,000, Paid-in-Capital in Excess of Par for $350,000 and Retained Earnings for $270,000. 4. The fair market value of Y's equipment was $100,000 higher than its net book value. This equipment has a five-year remaining life. All other assets and liabilities were stated at their fair value on January 1, 2011. Additional information X sold merchandise costing $40,000 to Y for $55,000 during 2011. At December 31, Y had 20% of this merchandise on hand. Y declared $20,000 in dividends during 2011. At December 31, only $15,000 of this dividend had actually been paid. Your boss, Jane Orderly, told you to make the necessary entries on the worksheet to straighten out the mess. She said "We might have to make entries on our books or Y's to fix this mess. If so, we will do that next year. Right now, I want you to get the consolidation worksheet completed ASAP!" Accounting policies Intangibles are amortized over a ten year period. Assume no impairment in Goodwill. X recognizes dividend income when the cash is received. X uses the straight-line depreciation method. Required Complete a consolidating worksheet for 2011 (using a spreadsheet program). Ignore income taxes. The attached worksheet is given to provide the account balances and to serve as a scratch sheet prior to generating the consolidated balances that are to be submitted.
Question 4
Please write at least 13 sentences for each questions: 1. "Integrated Marketing Communication" Please respond to the following: ?Evaluate overall how politicians engaged in the 2008 or 2012 Presidential campaign have integrated their marketing message. Then, evaluate one specific candidate of your choice. ?Pick a product which has experienced a failing promotional campaign. (Be sure the failure is due to a bad promotional campaign rather than a failed product, i.e. New Coke or IBM?s PC Jr.). Analyze why the promotion failed and recommend how it could be fixed if that same promotion was to be recycled this year. 2. "Advertising" Please respond to the following: ?Advertising during the Super Bowl is pricey and reserved for mega brands, but local television stations are allowed to air local advertisements during the broadcast. Size up your local market to determine at least three local businesses that could justify the extra advertising expense to air a commercial during the Super Bowl. Be sure to support your answer with evidence on how the advertising would benefit these businesses. ?Entrepreneurs are often tasked with wearing many hats, including building sales, marketing, and operations, to name a few. Advise a friend who wants to open a coffee shop in a popular neighborhood which currently does not have a coffee shop on how to spend her marketing time and budget (presume both time and budget are limited). 3. "Customer Evaluations" Please respond to the following: ?Yelp and Facebook are among the many growing social media sites allowing customers to give feedback about products, services, and experiences. This method allows for a passive approach to a problem or bad experience. For example, if someone had to wait 10 minutes in line for a latte, there may be no way for the barista to know this person waited this long or is disgruntled by the long wait. Design a process in which a small business can ensure customers are satisfied so that they do not quickly take a passive approach to merely complain to a large audience without first making someone at the business aware that a problem exists. ?We see surveys on all kinds of store receipts allowing consumers to give feedback in exchange for being entered into a drawing for a prize. Evaluate the purpose and usefulness of these surveys. Consider all stakeholders in your answer. 4. "Marketing Research " Please respond to the following: ?Of the marketing research tools identified in the textbook, evaluate those that would be most appropriate for a small business. ?When it comes to marketing research, speculate to the blunders that beginning marketers commonly make. Provide a rationale with your response.
Question 5
.ToolTime has a standard of 1.5 pounds of materials per unit, at $2 per pound. In producing 2,000 units, ToolTime used 3,100 pounds of materials at a total cost of $6,045. ToolTime's total variance is a. $150 F. b. $45 U. c. $155 U. d. $200 U. 2. ToolTime has a standard of 1.5 pounds of materials per unit, at $2 per pound. In producing 2,000 units, ToolTime used 3,100 pounds of materials at a total cost of $6,045. ToolTime's materials price variance is a. $45 U. b. $155 F. c. $200 F. d. $350 F. 3. ToolTime has a standard of 1.5 pounds of materials per unit, at $2 per pound. In producing 2,000 units, ToolTime used 3,100 pounds of materials at a total cost of $6,045. ToolTime's materials quantity variance is a. $45 F. b. $155 U. c. $200 U. d. $350 U. 4. ToolTime has a standard of 2 hours of labor per unit, at $18 per hour. In producing 2,000 units, ToolTime used 3,850 hours of labor at a total cost of $70,445. ToolTime's total labor variance is a. $1,155 U. b. $1,200 U. c. $1,555 F. d. $2,895 F. 5. ToolTime has a standard of 2 hours of labor per unit, at $18 per hour. In producing 2,000 units, ToolTime used 3,850 hours of labor at a total cost of $70,455. ToolTime's labor price variance is a. $1,155 U. b. $1,200 U. c. $1,555 F. d. $2,895 F. 6. ToolTime has a standard of 2 hours of labor per unit, at $18 per hour. In producing 2,000 units, ToolTime used 3,850 hours of labor at a total cost of $70,455. ToolTime's labor quantity variance is a. $1,155 U. b. $1,555 F. c. $2,700 F. d. $2,895 F. 7. The predetermined overhead rate for Weed-B-Gone is $10, comprised of a variable overhead rate of $6 and a fixed rate of $4. The amount of budgeted overhead costs at normal capacity of $300,000 was divided by normal capacity of 30,000 direct labor hours, to arrive at the predetermined overhead rate of $10. Actual overhead for June was $19,000 variable and $12,100 fixed, and standard hours allowed for the product produced in June was 3,000 hours. The total overhead variance is a. $6,100 F. b. $1,100 F. c. $1,100 U. d. $6,100 U. 8. The predetermined overhead rate for Weed-B-Gone is $10, comprised of a variable overhead rate of $6 and a fixed rate of $4. The amount of budgeted overhead costs at normal capacity of $300,000 was divided by normal capacity of 30,000 direct labor hours, to arrive at the predetermined overhead rate of $10. Actual overhead for June was $17,800 variable and $10,800 fixed, and 1,500 units were produced. The direct labor standard is 2 hours per unit produced. The total overhead variance is a. $3,600 F. b. $1,400 F. c. $1,400 U. d. $3,600 U. 9. Sonic Corporation?s variance report for the purchasing department reports 500 units of material A purchased and 1,200 units of material B purchased. It also reports standard prices of $2 for Material A and $3 for Material B. Actual prices reported are $2.10 for Material A and $2.80 for Material B. Sonic should report a total price variance of a. $190 F. b. $20 F. c. $20 U. d. $190 U. 10. The following information was taken from the annual manufacturing overhead cost budget of Coen Company. Variable manufacturing overhead costs $69,300 Fixed manufacturing overhead costs $41,580 Normal production level in labor hours 23,100 Normal production level in units 5,775 Standard labor hours per unit 4 During the year, 5,600 units were produced, 18,340 hours were worked, and the actual manufacturing overhead was $113,400. Actual fixed manufacturing overhead costs equaled budgeted fixed manufacturing overhead costs. Overhead is applied on the basis of direct labor hours. Coen's total overhead variance is a. $1,260 U. b. $4,620 U. c. $5,880 U. d.$16,800 U.,Thank's :) MARIA,thank's Michael :D MARIA
